SCIP Insight eBulletin
  October 2010  |  Vol. 2 Issue 10  CONNECT


ACADEMIC INSIGHT
Evaluating SWOT’s Value in Creating Actionable Strategic Intelligence

  By Kristan Wheaton
Assistant Professor
Intelligence Studies Department
Mercyhurst College



As Mike Finnegan points out in his recently completed Mercyhurst thesis, the strengths-weaknesses-opportunities-threats analytic method is "one of the most popular analytic techniques among competitive intelligence professionals.” Popular, yes. Effective? Not so fast.

Mike's survey of more than 100 business people with real-world strategic planning responsibilities and experience using SWOT in the workplace paints a very different picture of the value of this technique—a picture that should have consequences not only for the way it is used but also the way it is taught.

Specifically, Mike found that:
  • SWOT adds value only indirectly to the strategic planning process.
  • SWOT is performed far less often than necessary if it is to achieve even these limited goals (up to four times less often than necessary if Mike's data is correct).
  • SWOT should not be used as a standalone technique under any circumstances.
The entire thesis is well worth the read for anyone interested in evaluating analytic methodologies in general or SWOT analysis in particular. Mike collected a number of comments from his survey participants and they serve to ground the statistical data in the complexities of the real world—to add qualitative gravitas to his quantitative research. The best of these include participants’ reaction to SWOT as a standalone method, including these gems:
  • SWOT analysis is largely used to support other analyses, but also to provide insight into potential avenues the company may move towards.
  • Together with other analytical tools (STEEP, PEST, Four Corners), SWOT analysis forms part of a structured competitor profiling program that feed into the strategic planning cycle.
  • Usually, SWOT is a method for doing comparative analysis with other techniques, or as a funnel for getting people thinking on a macro level. This helps identify what specific analytic techniques need to be added.
Even more pointed were the participants’ comments regarding SWOT as something that added value to the strategic planning process:
  • Only modestly. It is a thinking tool.
  • It is a good tool to gather input from our team. The process of completing a SWOT is more valuable than the analysis because it helps to get everyone on the same page.
  • A good framework for discussion and analysis. Implementation is tricky in poor performing companies because they tend to hide their heads in the sand.
  • No, it is not future-oriented.
  • I believe a SWOT type analysis adds value through pulling the different departments of the company together to develop a synergistic strategy. It also helps prioritize the needs of each department within the context of overall company strategy.
  • It's a good starting point. Adds value? Yes. Able to stand on its own? No.
Mike also asked respondents a number of supplemental questions designed to add some depth to the original responses. One of the questions concerned who should conduct a SWOT analysis (or what is the best “environment” in which to conduct a SWOT analysis as Mike put it). It showed some surprising results as well.

Some 40 percent think that SWOT should include representatives from all relevant departments, while 27 percent think that it should be led by an outside consultant and the participation of all the relevant departments. Eleven percent thought SWOT should be done by corporate executives but only 3 percent thought it should be done exclusively by outside consultants. A whopping 20 percent fell into the “other” category indicating that there was no consensus view on who should be present in a SWOT analysis discussion.

Mike’s point seems to be that one of these approaches should be more useful than others from the planning perspective. He encourages others who might be interested in SWOT to take on this challenge. According to Mike, “This is an area that would benefit from having a more refined focus placed on it in future research.”

You can go here for the download (Note: The file was clearly corrupted when Mike uploaded it to Scribd. All the content is there but some of the pictures and graphs were moved around. While Mike corrects it, the data is still there, just not as "pretty" as it was in the original format). You can also find Mike on LinkedIn. He is more than happy to discuss the results of his research.

Evaluating SWOT's Value In Creating Actionable Strategic Intelligence

About the author:

Kristan J. Wheaton is an assistant professor of intelligence studies at Mercyhurst College in Erie, PA, where he teaches both graduate and undergraduate courses within the Department of Intelligence Studies. Kris holds a JD from the University of South Carolina, an MA in Russian and East European Studies from Florida State University and a BBA in Accounting from the University of Notre Dame. He is a retired Foreign Area Officer from the U.S. Army who specializes in national security matters. Kris can be reached at kwheaton@mercyhurst.edu His blog is at http://sourcesandmethods.blogspot.com/

Additional reading from Competitive Intelligence Magazine:

Fehringer, Dale (2007). “Six steps to better SWOTs.” Volume 10, number 1, January/February, p54-57. http://www.scip.org/Publications/CIMArticleDetail.cfm?ItemNumber=2098

Long, Allen (2007). “Compare apples and oranges for robust SWOT analysis” Volume 10 number 3, May/June p.31. http://www.scip.org/Publications/CIMArticleDetail.cfm?ItemNumber=2150

Fox, Ken (2009) “Identifying business opportunities beyond SWOT analysis” Volume 12. V12n1 January/February, p51-53. http://www.scip.org/Publications/CIMArticleDetail.cfm?ItemNumber=7281

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